Merkel's Allies On Course For Major Losses In Bavarian Election

Bavaria's governing Christian Social Union (CSU) is likely to lose its majority in the 14 October regional election.

The right-wing nationalist Alternative for Germany are on course to enter the regional parliament for the first time, providing representation for the party in 15 of the 16 state parliaments (all but Hesse, which holds its election on 28 October).

A poor result for the CSU is likely to lead to major changes at the top of the party, putting the positions of Bavarian Prime Minister Markus Soder and/or Federal Interior Minister Horst Seehofer at risk.

Chancellor Merkel's federal coalition government could also face greater instability from a weakened and resentful CSU.

The governing centre-right Christian Social Union (CSU) is on course to lose its majority in the regional parliament ( Landtag) of Germany's largest and second-most populous state, Bavaria. The election, to be held on October 14, is the first to be held in the state since the migration crisis of 2014-16 and the rise of the right-wing Alternative for Germany (AfD), both of which have had a major impact on German politics. The CSU is the sister party of Chancellor Angela Merkel's Christian Democratic Union (CDU) and sits as part of the federal government, as well as holding sole control of the Bavarian government. The party currently holds 101 of the 180 seats in the Bavarian parliament, with the centre-left Social Democrats (SPD) the second-largest with 42 seats. The remaining members are from the centrist regional Free Voters (FW) with 19 seats and the centre-left Alliance 90/The Greens (Greens) with 18 seats ( see chart below).

CSU's Majority Under Threat From Greens, AfD

Germany (Bavaria) - Current Composition of Landtag, Seats

Source: Landtag of Bavaria, Fitch Solutions

As Germany's south westernmost state, Bavaria has been the entry point for the large majority of the over one million migrants that have come to the country since the escalation of the migrant crisis in 2015. This in turn has spurred major ructions within Bavarian politics. Support for the CSU has declined from 47.7% in the 2013 election to around 33.0% in recent opinion polling. Those on the right have complained that both the federal and state governments have proved too lax with regards to both stopping immigrants crossing into Bavaria, as well as dealing with the various issues arising from attempting to integrate those migrants into Germany society, be it cultural or linguistic differences, or access and use of public services.

On the left the CSU administration faces criticism for being perceived to have shifted to the right in an attempt to stem the tide of CSU voters switching their support to the hard-line AfD. This has benefited the Greens in particular, which has argued for a more 'compassionate' attitude towards the migrants. The party's environmentalist stance, as well as its defence of primarily young private tenants who pay some of the highest rents in Germany, has seen support for the Greens rise to nearly 20.0% ( see chart below), which if replicated in the election would be the party's best ever result. Much like the CSU, the SPD is also on course for major losses, with it's support falling to around 11.0% in recent opinion polls, from 20.0% in the 2013 election. Battling for third place with the AfD marks a major decline for a party that has consistently sat as the main opposition to the CSU in Bavaria since the formation of the German Federal Republic.

Following the election, depending on what parties make it into the Landtag, the CSU (which is almost certain to remain the largest party) will have several options on forming a coalition. It could seek to work with the Greens, something that has occurred in other German Lander. However, the CSU is more socially conservative than the CDU at the federal level, and therefore may find it difficult to come to an agreement with the liberal Greens, particularly on issues of migration and integration. Should the libertarian Free Democrats (FDP), currently polling around 5.0% threshold, enter parliament the CSU may seek to work with them, as they did on the only previous occasion the CSU lost its majority between 2008 and 2013. In what would be a major shock, the CSU could even seek to work with the AfD. No party has ever worked with the AfD in government at the state level, and the CSU would risk alienating its CDU allies at the federal level if it went into government with the right-wing nationalist party. As such, we view this as an extremely unlikely scenario.

A poor result for the CSU is likely to lead to major changes at the top of the party. Former state premier, current party leader and Federal Interior Minister Horst Seehofer, as well as incumbent state premier Markus Soder have both faced criticism from CSU supporters. Soder, who took over from Seehofer in March, has faced criticism for his decision to hang crucifixes in public buildings, a move perceived as blurring the boundaries between church and state. Meanwhile, Seehofer has clashed numerous times with Chancellor Merkel due to what he believes to be her soft stance on immigration. The dispute has caused consternation among the public and the CSU for not addressing issues, instead getting involved in personal bickering. This extends to the relationship between Soder and Seehofer, with the former likely seeking to take over as CSU leader but Seehofer unwilling to step down. If the party suffers major losses it could mark an end to the career for one, or even both men. Nevertheless, with regards to policy we do not expect a notable shift from the CSU given its evident divisions, both at the grassroots level and among its representatives in the regional parliament.

Chancellor Angela Merkel would also face notable pressure in the event the CSU suffers major losses. Her coalition at the federal levels involves her CDU, the CSU, and the SPD, and is riven with divisions. Many CSU federal deputies would lay the blame for their parties' failure at Merkel's door, arguing her welcoming stance towards migrants sowed the seeds for the rise of the AfD and a challenge on the CSU's right flank that had not been there previously. We have previously highlighted the trouble Merkel faces in keeping her government together ( see ' CDU-CSU Spat Compounds Fragility Of German Government' 6 August) amid a fractious political environment distrustful of mainstream parties, and a weakened and resentful CSU would compound these concerns.